Common Goods :

▪ A commodity or service that is provided without profit to all

members of a society, either by the government or a private
individual or organization.
▪ Public goods are termed as "non-rivalrous" (don’t surpass by
others) and "non-excludable."
▪ A common good, also called common property resource, is a
good that is non-excludable and rival. A good is non-excludable
if you can't prevent anyone from using it, for example, a national
forest or a public river. Rival means that the good can be used up.
An entire forest can be mowed down in a single clear-cut.
▪ Example: Government Hospital, National park, Sewer system, Law
Enforcement,Wildlife, Air, Atmosphere, Ecosystem etc.
• A public good is a product that one individual can consume
without reducing its availability to another individual and from
which no one is excluded.
• A public good is an item consumed by society as a whole and
not necessarily by an individual consumer.
• Public goods are financed by tax revenues.
• All public goods must be consumed without reducing the
availability of the good to others, and cannot be withheld from
people who do not directly pay for them.
▪ The tragedy of the commons is an economic theory of a situation
within a shared-resource system where individual users acting
independently according to their own self-interest behave contrary to
the common good of all users by depleting or spoiling that resource
through their collective action.
▪ The tragedy of the commons is an economic problem that results in
overconsumption, under investment, and ultimately depletion of a
common-pool resource.
▪ For a tragedy of the commons to occur a resource must be scarce,
rivalrous in consumption, and non-excludable.
▪ Solutions to the tragedy of the commons include the imposition of
private property rights, government regulation, or the development
of a collective action arrangement.
▪ Historical examples of tragedies of the commons include the collapse
of the North Atlantic Cod fisheries and the extinction of the Dodo
Bird,
▪ The idea of the tragedy of the commons was made popular by the
American ecologist Garrett Hardin, who used the analogy of
ranchers grazing their animals on a common field.
▪ When the field is not over capacity, ranchers may graze their
animals with few limitations. However, the rational rancher will
seek to add livestock, thereby increasing profits. Thinking
logically but not collectively, the benefits of adding animals
adhere to the rancher alone, while the costs are shared.
▪ The tragedy is that ultimately no rancher will be able to graze the
field, due to overconsumption.
▪ This scenario is played out on a daily basis in numerous instances,
having grave consequences for the world’s resources.
Privatizing Property
▪ By making resources private property, owners will have an incentive to keep others off
their property, which would limit the number of users, and to use the property sustainably
so they can benefit from it in the future. This approach is plausible as long as the property
is not too large, which makes it difficult to control trespassing.
Regulating Public Property
▪ Another theoretical solution to avoid the degradation of resources is to "keep them as
public property, but allocate the right to enter them" . Hardin allows that there are many
ways to allocate access - basis of merit, first come first serve, auction system - and while
these may not be perfect or even desired, they are necessary to ensure the resources'
sustainability.
Holding Property Communally
▪ For smaller resources, such as inshore fisheries, shellfish beds, rangelands, and some
forests, holding the property communally and allocating use through the community can
be feasible. This was not considered by Hardin and communal property is rare around the
world. If everyone in a community has an equal right to the resource and the community's
population grows, the resource will be brought under increasing strain.
▪ Property rights define the theoretical and legal ownership of resources and
how they can be used.
▪ These resources can be both tangible or intangible and can be owned by
individuals, businesses, and governments.
▪ In economics, property rights form the basis for all market exchange, and the
allocation of property rights in a society affects the efficiency of resource
use.
▪ Property is secured by laws that are clearly defined and enforced by the
state. These laws define ownership and any associated benefits that come
with holding the property.
▪ The term property is very expansive, though the legal protection for certain
kinds of property varies between jurisdictions.
✓The right to use the good

✓The right to earn income from the good

✓The right to transfer the good to others

✓The right to enforce property rights

❖Property is generally owned by individuals or a small group of
people.
❖The rights of property ownership can be extended by using
patents and copyrights to protect:

✓Scarce physical resources such as houses, cars, books, and

cellphones
✓Non-human creatures like dogs, cats, horses or birds
✓Intellectual property such as inventions, ideas, or words
❖Public property (also known as state property) is property that
is publicly owned, but its access and use are managed and
controlled by a government agency or organization granted
such authority. An example is a national park or a state-owned
enterprise.
❖Common property or collective property is property that is
owned by a group of individuals. Access, use, and exclusion are
controlled by the joint owners. True commons can break down,
but, unlike open-access property, common property owners
have greater ability to manage conflicts through shared benefits
and enforcement.
❖Private property is both excludable and rival. Private property
access, use, exclusion and management are controlled by the
private owner or a group of legal owners.
THANK YOU